Gross Profit Margin
Gross Profit Margin is ultimately the most critical metric for a publisher to track. Although it may seem like the introduction of new digital technology would have detrimental effects on the publishing industry, instead it has given publishers a great opportunity to expand margins. eBooks, for example, don’t carry some of the costs of a printed book (paper, ink, binding, physical distribution, etc.).
“72% of publishers plan to actively experiment with artificial intelligence (AI)”
Source: Reuters Institute
Distribution Cost as a % of Revenue
The publishing industry incurs high fixed costs, including compensation to authors, editing, design and marketing. As a result, it’s important to keep the distribution costs as low as possible to maintain acceptable margins. For traditional publishing methods, including hardcover and softcover publications, distribution costs include shipment to retail locations through internal distribution mechanisms or via a third-party distribution channels. The cost of digital distribution for publications like eBooks includes the cost of making titles available on various online marketplaces.
- > 9%
To stay afloat in today’s competitive publishing landscape, revenue growth is dependent on adapting business models to incorporate the myriad of ways consumers access content today. Many publishers are still relying solely on traditional revenue streams, while others have embraced the change, introducing new sources of revenue like eBooks, podcasts, online subscriptions, etc. Revenue growth is a key metric that differentiates the publishers that are on the forefront of these changes from the publishers still dependent upon traditional revenue streams.
(% of Revenue)
(% of Revenue)
Finance FTE per
IT FTE Per
Your business may just be beginning to track this metric, perform this business function or identified this as a problem. Improved execution in this area should be a high priority.
Your business is competitive in this area, but there’s still room for advancement. Consider investments to improve related operations to achieve better results.
Best in Class
Your performance in this area is considered best in class and is superior to the average company in your sector. You’ve laid a solid foundation in this business function, and the next step is optimization.
You’re achieving the optimal results for this metric. Your business processes in this area are highly efficient and stand out against competitors. Keep investing in this area to maintain these results.